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Will the Administration's Deferred Action Directives Bring a New Wave of Class Actions?

December 12, 2014

A recent class action alleging discriminatory hiring practices against beneficiaries of the Department of Homeland Security’s Deferred Action for Childhood Arrivals (“DACA”) deserves attention in light of President Obama’s recent directive to defer action for as many as five million individuals. The suit was filed this past July in the Southern District of New York and is currently pending before Judge Katherine Forrest. The named plaintiff alleges the company’s hiring policies constitute unlawful discrimination based on alienage under 42 U.S.C. § 1981. Courts have long been resistant to allowing alienage claims under Title VII, which does however allow closely related national origin discrimination claims, and that is likely why the plaintiff has sued under Section 1981, which prohibits discrimination based on alienage.

The plaintiff is a beneficiary of DACA, an initiative by President Obama to provide employment authorization to individuals who came to the United States as children and meet certain criteria. Under the DACA program, beneficiaries receive both a social security number and an employment authorization document allowing them to work in the United States. The suit alleges that an individual who applied for a job with the company was told he had to be a United States citizen or lawful permanent resident to be hired. The company also allegedly advertised on its website for the position, requiring applicants to have three years continuous residency or anticipated three years of continuous residency completed upon college graduation. Since the job was limited to those who have three years of continuous residency, DACA beneficiaries would presumably not be considered for the position, according to the named plaintiff.

The company moved to dismiss the complaint, arguing its policy did not discriminate against aliens, because it did not limit employment to United States citizens, and encouraged aliens who met the residency requirements to apply. In other words, the company did not prohibit all non-United States citizens from applying, and therefore did not discriminate on the basis of alienage. The company’s arguments did not convince the court. Judge Forrest, in her decision denying the motion to dismiss, held that the company’s policy, as alleged, discriminates on its face against a portion of lawfully present aliens who are members of a protected class under Section 1981.

To reach her decision, Judge Forrest categorized beneficiaries of DACA as “lawfully admitted” aliens to justify her reliance on Supreme Court precedent, which does not allow drawing distinctions between classes of lawfully admitted aliens. It is worth noting that DACA recipients are not lawfully admitted under the immigration statutes (8 U.S.C. § 1101(a)(13)(A)). Rather, by granting DACA status, the Department of Homeland Security has simply made the decision not to take action against a group of aliens who have not been admitted or paroled. If other courts follow Judge Forrest’s reasoning, Section 1981 may become a vehicle for other claims of discrimination based on alienage. This would undoubtedly raise the possibility of an increased number of alienage suits brought against employers.

At this point, the suit is going forward. And should it prove successful, it could open the floodgates to similar lawsuits against employers. This case further illustrates the grey areas that will emerge for employers with President Obama’s recent directive to provide work authorization to a large class of previously unauthorized workers. The recent order providing deferred action to a large amount of the workforce will present both benefits and challenges to employers. We will be watching this issue closely and inform employers as it unfolds.

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.